In line with the trend over the past many months, workers’ remittances stayed above $2 billion in July 2022 despite a decline of over 8% on a month-on-month basis
According to data released by the State Bank of Pakistan (SBP) on Tuesday, the remittances sent home by overseas Pakistanis declined by 8.6% (month-on-month) and 7.8% (year-on-year) to $2.5 billion in July. This was the 26th successive month in which receipts remained above the $2 billion threshold, SBP reported. The central bank attributed the decline to fewer working days during the first month of the fiscal year 2022-23.
“This decrease largely reflected the lower number of working days in July as a result of Eidul Adha, at 17 working days compared to 22 last month and 18 in July 2021,” it noted. “Remittances are a lifeline for Pakistan to fill the large gap between imports and exports,” former advisor to Finance Ministry Dr Khaqan Najeeb said. The former advisor hoped that the decrease is reflective of the fewer working days (17) in July as a result of Eid – as mentioned by the central bank.
He, however, noted that Eid usually pushes Pakistanis to send more to their families which didn’t happen partly due to the depreciating rupees which could have made them wait longer in the hope of a better parity rate. “Pakistan’s remittance initiative must be kept strong to ensure formal channels of remittances are used as the world travel opens,” he maintained. Cumulatively, in the fiscal year 2021-22, remittances clocked in at $31.2 billion compared to $29.4 billion received in FY21.
Country-wise remittances
Country-wise data reveals that inflows from the United States of America (USA) decreased by 8.26% to $254.3 million in July compared to the same month of last year. They improved by 3.46% to $411.7 million in the United Kingdom (UK). Inflows plunged by 16.7% to $456.2 million from the United Arab Emirates (UAE) while remittances fell 12.01% to $456.2 million from Saudi Arabia. Moreover, remittances from other Gulf Cooperation Council (GCC) countries decreased by 6.56% to $280.6 million and a 2.22% decrease was recorded in inflows from European countries, which clocked in at $294.4 million in the month under review compared to the same month last year.
